On January 1, Eastern College received $1,370,000 from its students for the spring semester that it recorded in Unearned Tuition and Fees

Business Mar 01, 2021

On January 1, Eastern College received $1,370,000 from its students for the spring semester that it recorded in Unearned Tuition and Fees. The term spans four months beginning on January 2 and the college spreads the revenue evenly over the months of the term. Assuming the college prepares adjustments monthly, what amount of tuition revenue should the college recognize on February 28?

Multiple Choice

A.)$342,500.

B.)$970,000.

C.)$1,027,500.

D.)$1,370,000.

E.)$685,000.

Expert Solution

Answer:

On February 28 2 months have been lapsed hence revenue is earned for these
two months so adjusting entry to be passed is:
	Dr	Cr
Unearned Tuition and Fees	$685,000
Tuition Revenue (1370000/4*2)		$685,000

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